New home sales fell substantially in February, preliminary numbers show

/ EdgeProp Singapore |

March 7, 2022 8:34 PM SGT

Normanton Park saw the highest number of units sold in February, based on preliminary data up to Feb 27 (Photo: Samuel Isaac Chua/The Edge Singapore)

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SINGAPORE (EDGEPROP) - Preliminary numbers for new private home sales show that developers sold a substantially lower amount of homes in February compared to the month before.

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According to caveats lodged with URA up until Feb 27, developers sold 490 new private homes (excluding executive condominiums or ECs) in February. The figure is down by 27.2% m-o-m from the 673 new units transacted in January. It is also down 24% y-o-y from the 645 units sold in February 2021.

The number of EC units sold by developers in February totaled 29 units based on the preliminary data, down 44% m-o-m and 74% y-o-y.

“One of the key reasons for the slower sales was the lack of new major residential launches in February 2022,” says Nicholas Mak, head of research & consultancy at ERA Singapore.

The freehold Royal Hallmark was the only residential project launched last month. The boutique 32-unit development located in District 15 within the Rest of Central Region (RCR) sold 10 units during the its launch weekend on Feb 26 at a median price of $1,904 psf.

Besides the lull period following the Chinese New Year festivities, Mak also notes that launches may have been held back due to the current wave of Covid-19 infections due to the Omicron variant.

Wong Siew Ying, head of research & content at PropNex Realty, views that the fast-depleting unsold inventory in the suburbs may have also contributed to the lower sales.

“As at the end of 4Q2021, the unsold inventory in the RCR and Outside Central Region (OCR) were both at record lows of 4,306 and 3,972 units respectively. As more units in existing projects are transacted, buyers may find that the balance stock of unsold homes may not be suitable for them, in terms of unit size and pricing,” Wong explains.

She expects the mismatch in supply and buyers' needs could persist and continue to weigh on sales volume until more RCR and OCR launches come on stream.

Of the 490 private new homes sold up until Feb 27, units in the RCR made up the majority, with 253 units transacted, or 51.6% of the monthly total. Sales in this region were led by Normanton Park, which saw 84 units transacted at a median unit price of $1,853 psf.

Meanwhile, 144 new private homes changed hands in the OCR, with Dairy Farm Residences the top seller. 30 units at Dairy Farm Residences were sold at a median price of $1,715 psf.

“The sales volume recorded in the OCR in February 2022 was one of the weakest transaction volumes that this sub-market had seen since April 2020, when the circuit breaker measures were imposed,” Wong comments.

In the prime Core Central Region (CCR), new home sales fell to a one-year low with 93 units sold in February. Leedon Green was the most popular CCR project during the month, with 14 units transacted at a median price of $2,838 psf.

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Wong believes the cooling measures introduced in December 2021 could have dampened sales in the CCR, given that this sub-market tends to attract investors and foreign buyers, who are more severely affected by the hike in additional buyer’s stamp duty (ABSD) rates.

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Despite the sharp fall in sales volume, Wong notes that prices appear to be holding up for now. “Comparing transacted values in February 2022 against December 2021, the average unit prices of RCR and OCR non-landed private new homes remained steady, while that of CCR homes dipped by 2.6%, according to caveats lodged,” she says.